Democratic Budget Plan Restores Healthcare Funding

Democrats' $100 million injection to healthcare funding sure to come under the Christie microscope.

Democratic legislators followed up their criticism of Gov. Chris Christie's healthcare funding plans with financial action, adding more than $100 million in new or restored monies to their own 2012 budget proposal. The Democrats have been hammering Christie for what they called short-sighted spending cuts that would harm New Jersey’s most vulnerable citizens.

Christie, commenting through a spokesman, has already made his opinion about the Democratic proposal plain, dismissing it as "fantasy budgeting."

The Democrats’ proposed $30.6 billion spending plan, restores millions in funding for women’s health programs, prescription drug subsidies and FamilyCare, the state’s health insurance program for low-income families. It also increases funding for reimbursements to nursing homes and federal health clinics for low-income residents, both of which saw rates cut under the governor’s plan.

Regardless of the administration's objections, healthcare advocates welcomed the news, noting that these services play a critical role as people struggle to recover from the recession. "We’re happy to see a budget that actually makes sense for New Jersey," said Crystal Snedden, healthcare campaign coordinator for Citizen Action. She called restoring funding to programs like women’s healthcare "a no-brainer," adding, "It is good for our health and our economy."

The Democratic budget also relies on far more conservative estimates of the savings available to the state through an overhaul of its Medicaid program, something that the administration may well contest.

The governor's budget proposal put Medicaid savings at $300 million. Democratic leaders cut this figure in half, to just $149 million in savings or increased federal revenue. (Any changes to Medicaid require federal approval). They also zeroed out an $18 million savings the governor had anticipated from increased efforts to root out Medicaid fraud, a figure critics said was unrealistic to achieve.

Several committees in the Democratic-led legislature also adopted a resolution urging the federal government to reject the governor’s so-called Comprehensive Medicaid Waiver Request, which would overhaul administration of the program, restrict access and limit some co-pays and services, among other cost-saving measures. The resolution has been approved by the Senate and Assembly budget committees. Expectations are that it will pass but it is unclear what impact it might have on the federal government’s decision.

The Clock Is Ticking

State law requires that the governor sign the budget by July 1, leaving elected officials just two days to come to some kind of an agreement. If no deal is in place by then, all non-essential state services will be shut down until a compromise is struck.

When the governor introduced his $29.4 billion budget plan in February he was characteristically forceful in underscoring the need to reform and curb costs within the state’s sprawling Medicaid and FamilyCare programs, which provide care to 1.3 million New Jersey residents at a cost of nearly $10 billion paid by the state and federal governments. The goal, Christie said, was to put the program on "sounder footing for the future" and "preserve priorities" such as care for children and those with disabilities.

But Democrats were equally forceful, attacking Christie’s proposals on several fronts. De-funding family planning would lose the state millions more in federal funding, and reducing FamilyCare eligibility for adults would also hurt children, they said. Critics argued that the Medicaid reform was too drastic from a policy standpoint and far too ambitious in its savings goals.

To address these concerns, the entire Democratic budget relies on recent, more generous state revenue estimates to provide additional funding to a variety of state offices, including $50 million more for the Department of Health and Senior Services. The DHSS changes include restoring $7.5 million for family planning clinics, $4.6 million to help fund care at low-cost federal clinics and more than $30 million for nursing home payments, which had been reduced under the governor’s plan.

The question remains: Will these restored funds come under Christie's line-item veto pen.

A Democratic Priority

"Women’s healthcare has always been a Democratic priority," noted Assembly Budget Chairman Louis Greenwald (D-Camden). "In fact, it was a priority for just about every one of us until Gov. Christie took office and decided to place ideology over smart medical policy for our mothers, wives, sisters and aunts."

Kevin Roberts, a spokesman for Christie, declined to address Greenwald's comments directly, instead providing a statement from Christie that called the Democratic plan "unrealistic, pie in the sky," that "only serves to denigrate all the hard choices made over the last year."

Other Democratic proposals include $6 million in new funding to help trauma centers and a diversion of nearly $2.8 million from the Cancer Institute of South Jersey to help build a new medical school in Camden that is a joint project of Rowan University and Cooper Hospital. Another measure added $450,000 in funding for treatment of post-partum depression and related conditions.

The Department of Human Services budget would increase $59 million thanks to the Democratic plan, which provides an additional $13 million for prescription drug assistance and $11 million for home healthcare programs. The proposal also blocks the closure of two state hospitals, the Hagerdorn Psychiatric Hospital and the Vineland Developmental Center, and reinvests in operations the $9 million the governor set aside for shutting them down.

Funding FamilyCare

Democrats also used the budget to restore funding to FamilyCare, addressing cuts that -- although relatively small in dollar amount -- had kicked up a storm of controversy over the potential impact on struggling state residents. The new proposal includes $4 million to protect a subset of 1,400 adults who were in danger of losing coverage because of their lack of dependent children and/or income level.

The Democrat's proposal also calls for re-establishing the program’s 2007 eligibility levels, which would allow parents who earn up to 133 percent of the federal poverty limit -- or almost $475 a week for a family of three -- to participate once again. Under the governor's cuts, the program would be limited to parents who earned less than 25 percent to 30 percent of the poverty limit, as little as $100 a week for a family of three. Christie’s plan could affect 23,000 parents who are currently eligible -- but not enrolled -- in FamilyCare, Crirics assert that the impact could be far more widespread. Both budget plans would continue to cover parents currently enrolled and would also keep the program open to children in families who earn up to 350 percent of the poverty level.

"These restorations are a matter of decency and core Democratic principles," said Sen. Joseph Vitale (D-Middlesex), who helped create FamilyCare 13 years ago and is a co-sponsor on the Senate resolution to block the Medicaid waiver. “I also know they are values that the majority of New Jerseyans embrace.”